List Of Documents To Prepare Before Selling Your House In The Philippines

Decided on selling your real estate property in the Philippines? The process that lies ahead entails meticulous preparations and patience in familiarizing yourself with the steps. Like any legal matter, selling a real estate property in the Philippines requires securing legal documents and enduring many trips to government offices such as as Registry of Deeds' office.

But a committed property owner must follow the right process and make sure the necessary documents such as tax declaration, transfer certificate of title, condominium certificate of title (if selling a condominium unit), real estate tax clearance, transfer certificate, etc. are ready before handing the real estate property to a new owner.

Part of ensuring a smooth and safe property selling transaction is also seeking the help of a real estate broker who can make things less overwhelming for you and a property buyer. This will also ensure a headache-free process for both the property seller and their prospective buyers.

To kickstart your preparations, here's a helpful guide that maps out your journey as a seller and a list of the important documents you need to sell your property in the Philippines.


First thing's first:

Make sure your documents as current property owner are complete. As the current property owner, your responsibility as seller is to be able to have the property, along with the documents of ownership, legally transferred to the new owner's name. This will not be possible if the seller does not possess a complete set of these necessary documents:

• Certified True Copy of Transfer Certificate of Title (Land)
  This can be obtained from the Registry of Deeds - City Hall
  
  
  
• If you are transferring a condominium unit and condominium parking, make sure to have the following:
  - Certified True Copy of Condominium Certificate of Title (Unit)
  - Certificate of Ownership (along with the condominium parking, if applicable)
  
  
• As a property owner selling from overseas, make sure to prepare the following documents:
  - Special Power of Attorney if a representative will be signing on your behalf
  - Deed of Assignment of Rights (in the absence of a title for pre-selling a real property, check with your property - developer if they will permit this)
  - Contract to Sell from your property developer
  - Most Recent Statement of Account

Second order of business:

Update or Fix the Status of Your Property TaxesGain the confidence of your buyer by ensuring that you consistently fulfilled your tax obligations. You and your broker must procure the following tax declaration documents from the assessor's office:

• Certified True Copy of Tax Declaration (Land)
• Certified True Copy of Tax Declaration (Improvements)
  
  
  

If you are selling a condominium to a buyer, make sure to procure and prepare the following tax declaration documents for your condominium purchasers:

• Certified True Copy of Tax Declaration (Condominium)
• Certified True Copy of Tax Declaration (Condominium parking, if applicable)

Among the legal documents a seller and a broker must also procure are the:

• Real Estate Tax Clearance for Current Year- this can be obtained from the City Treasurer's Office
• Certificate of Non-Improvement if property is bare and without structures such as a house or a building
  
  
  

It is important to note that apart from updating taxes, an owner providing complete tax documents must also inform their LGU of any improvements or changes done on the property subject. Otherwise, undeclared changes on the property will be subject to back taxes.




The third step:

Know your expenses by determining the tax applied to your property.

Good job procuring all the important documents needed for your potential buyer! Now comes another important part of your selling journey: determining your net profit by computing your biggest expense: taxes!

• Capital Gains Tax: This is the income tax levied on the profit gained from selling a property. These are properties that are non-trade or business like homes, land, and cars. A capital gains tax is always 6% of the property’s gross selling price or market value, whichever is higher.
• Ordinary Assets Tax: Income-generating properties are classified as ordinary assets. The ordinary assets tax is 6% of withholding taxes, plus income tax, 12% VAT, and documentary stamps tax.

Taxes aside, it would be wise to deduct your other expenses from your profit. This would include a real estate agent's fee, marketing collaterals for printing, and fee for a professional photographer to take photos of your property if you are selling our property online.

The fourth step:

Ready the after-sale documents of your property prior to turning over to your home buyer.After securing a sure buyer of the property, the seller and the broker must prepare these essential documents:

• Letter of Intent from the Buyer or Offer to Buy
  
  The letter of intent is the first document the buyer sends to the property vendor expressing an intention to buy the property for sale.
  
  This letter includes a detailed information about the sales terms such as the time of sale and description of the property, current market value of the property, earnest money (this is provided as means of holding the property subject to the buyer's due diligence), and other terms and conditions. This should be signed by the broker and the buyer.
  
  
• Contract to Sell
  
  These documents contain written agreements between the seller and you with respect to purchasing your house. There are specific sales requirements required of both sellers and buyers prior to completing payment. This contract is only for homes where there was a down payment to pay the remainder.
  
  If the sale contract is properly executed, the sale contract becomes the basis for execution of the deed of absolute sale confirming the completion of the sale. This will be arranged through the broker or the developer. After a buyer is fully paid, a sale agreement is drafted by the developer to the seller.
  
  
• Deed of Absolute Sale
  
  The Registrar's Deed of Trust is the final record transferring the rights of the property to a new home buyer. This will provide a certificate of ownership for houses or lots or condo-related property in exchange for a condominium owner certificate for the new owner.
  
  If a buyer makes a complete payment upfront, you'll receive a letter of credit on your mortgage. The documents could be produced either by the buyer or the seller but must be prepared by a notary public.
  
  
• Endorsement Letter
  
  This is given to the property or condominium property administration endorsing the property to the new owner's name.
  
  
• Certificate Authorizing Registration (CAR) from the Bureau of Internal Revenue (BIR)
  
  

Key takeaways:

When selling a property in the Philippines, it pays to know the documents required. Having your land title, tax clearance, and tax declaration documents on hand makes life easier for your broker and lessens the risk of losing the interest of buyers.

Up Next:
​How To Prepare Your House For Sale (so you can make it sell fast!)

Lot in Manila, Sta. Ana PHP728,235,000

Learn More

Three Bedroom in Acqua Private Residences PHP19,000,000

Learn More

Commercial/Office/Storage and Residential Building PHP 75,000,000

Learn More

Townhouse For Sale In Quezon City PHP24,000,000

Learn More

4 Bedroom Condo For Sale in The Suites BGC PHP175,000

Learn More

4 Bedroom Penthouse For Lease PHP520,000

Learn More